There might be time to save your home

Family issues

Question: After more than a year of wrangling, my husband and I reached an agreement -- or at least I thought we had. The settlement process that occurred on the day before our divorce trial went so fast that I don't know if I understood everything that my husband and I agreed to.

But there's one thing I know for sure: My lawyer never told me -- or at least I don't remember -- that the only home our two children have ever known will be sold, and we will have to move because we can't afford to keep it. As it now stands, my husband will get half of the furniture, and we will equally divide the equity. I am having second thoughts and don't want to move back in with my parents, but my lawyer says a deal is a deal. Do I have any other options?

Answer: Quick settlements as you describe are not uncommon in the matrimonial setting, especially close to the trial. However, it is important not to sacrifice your rights simply to get the case settled. Today, with the devaluation of residential real estate, and the slowdown of the real-estate market, the family home is no longer one of the most significant assets acquired during a marriage and will probably be difficult to sell.

Because of the economic fallout occasioned by a marital split (unless the spouses have previously worked out an agreement), a judge may decide that it is unfair to let one spouse use the residence and tie up the other's equity for a long period of time. In these times, it may be more economically feasible for the custodial parent and children to remain in the home when the mortgage payment is probably the same as the rent on a much smaller apartment.

Long story short, you and your lawyer should have been prepared for the potential of what was going to be done with the house from the outset. You could have looked into alternate housing and compared the cost of staying at home as opposed to renting an apartment or house. You could have also looked into possible school changes and the effect upon your children.

By calling Realtors or brokers, you would have received estimates on the length of time it might take to sell your home, at what price, and the comparative cost of renting. Since a move has been a distinct possibility from the get-go, you should have secured estimates from moving companies in order to make sure that your settlement included the cost of moving. And should there be a sale, you should receive your share of insurance and tax refunds.

If you are interested in keeping your house, you could have looked into the potential of total refinancing, a second mortgage, a home equity loan, or any other means by which you could have secured the money to purchase your husband's share which, at today's prices, may be rather minimal. If you don't have credit or the financial means yourself, you could have considered asking your parents or other relatives who may be willing to help you by loaning you money or endorsing your note. Or, you might have considered exchanging your interest in your husband's retirement or other assets for his interest in the house.

Because disputes over furniture and personal property can be expensive, you should have been thinking about how to fairly evaluate and divide your personal property. While used furniture may not bring a lot of money if sold, it is still very valuable to a parent with children.

Bottom Line: Your lawyer should have prepared you for this contingency earlier so that you could have prepared, however, it may not be too late. We believe you should investigate the possibility of refinancing and then purchasing your husband's interest in the house. If your parents are able, each of them could gift you $12,000 this year to help defray this cost. Or, depending on the value of your husband's retirement and other assets, you may want to swap your entitlements for his.